Friday, July 11, 2008

Sustaining Respondent Braided Accents, L.L. C.'s affirmative defense of laches, the Board dismissed a petition for cancellation of the mark BRAIDED ACCENTS & Design ["BRAIDED" and the pictorial representation of a braid disclaimed] for moldings, door frames, window frames, rails and wainscotting. Petitioner Klise Manufacturing claimed likely confusion with its registered and previously-used mark ACCENT for non-metal decorative molding and trim, but the Board found that its delay of 62 months in filing the petition for cancellation had prejudiced Respondent and was unreasonable and unexcused. Klise Manufacturing Co. v. Braided Accents, L.L.C., Cancellation No. 92045607 (July 3, 2008) [not precedential].

Petitioner established standing and priority by reason of its constructive use of the mark ACCENT from June 24, 1977 (the filing date of the application which issued as its pleaded registration). Respondent began use of its mark in 1998.

Likelihood of confusion: The Board found the goods to be in part identical and, in light of the lack of restrictions in either party's registration, it was required to presume that the goods travel in the same normal channels to the usual classes of purchasers for those goods. As to the marks, the word ACCENT is the dominant portion of Respondent's mark, and the Board found the marks in their entireties to be "more similar than dissimilar."

The Board noted the lack of actual confusion during the nine years that the marks have been in concurrent use, and it found some overlap of use "inasmuch as both parties sell their goods to distributors and have advertised their goods nationally, including at trade shows." However, there was no evidence that "the parties share common distributors for their goods or that they advertised in the same publications or attended the same trade shows." And so the lack of actual confusion "weighs only slightly in favor of respondent."

Considering all the du Pont factors, the Board found confusion likely.

Laches: The affirmative defense of laches requires undue or unreasonable delay by petitioner in asserting its rights and prejudice to respondent resulting from the delay. Unless confusion is inevitable, laches bars a petition for cancellation grounded on Section 2(d).

The Board found that Petitioner Klise had actual notice of Respondent's use of its mark as early as 1998 or 1999, both dates preceding the publication date (January 2, 2001) of the application that led to the challenged registration. However, in a cancellation proceeding, "the objection is to the rights which flow from registration of the mark," and so laches begins to run from the publication date of January 2, 2001. The petition for cancellation was filed on March 20, 2006, a delay of approximately five years and two months. [TTABlog note: Respondent's registration issued on March 27, 2001, so the petition for cancellation was filed one week before the 5-year statute of limitations of Section 14 had run].

The Board pointed out that Respondent need not show reliance on the delay: i.e., "petitioner does not have to overtly or covertly lull respondent into believing petitioner would not act."

Here, Respondent Braided Accents "greatly expanded its operations in recent years." Petitioner acknowledged that Respondent had opened a new manufacturing building and showroom. In view thereof, the Board found that the length of delay was "significant and that prejudice would result" if the registration were cancelled.

Petitioner asserted, however, that its delay was justified under the doctrine of "progressive encroachment," i.e., that it decided not to act until Respondent expanded its operation to the point where it encroached on petitioner's business. The Board found that this argument "rings hollow." Petitioner was never put on notice by petitioner "as to any limits to its geographic area of commerce, production capacity, or any possible encroachment upon petitioner's business." Respondent did not change the nature or type of its goods, "but stayed within its rights accorded to it by virtue of the subject registration." Thus, the Board concluded, Petitioner's delay was not justified.

Finally, the Board noted that the defense of laches is inapplicable if confusion is inevitable, i.e., where there is no reasonable doubt that likelihood of confusion exists. In such a case, the injury to respondent caused by the delay is outweighed by "the public's interest in preventing confusion." Here, the Board found that confusion is likely, but it is not inevitable:

"Although the goods are identical in part, the marks are not so similar that we can find confusion to be inevitable. The marks are somewhat suggestive and may be entitled to a narrower scope of protection than purely arbitrary or coined marks. In addition, there has been over nine years of concurrent use of the marks without any reported instances of actual confusion."